this is the business briefing. i'm sally bundock. poison apple for investors as the tech giant slashes forecasts, saying the slowdown in china is worse than it thought. plus, the us budget deadlock continues — is this the start of tough times for the president as the democrats take control of the house? and on the markets, that warning from apple coming too late to hit us shares, but in asia, the tech giants suppliers are all being sold off. we will see reaction on wall street today. the nick cave has actually closed again today for a public holiday, but elsewhere we are seeing stocks down —— nikkei. we'll be live to the region shortly. we start in california, where tech giant apple has rattled

global investors with its first warning about its financial results in more than a decade. in a letter to shareholders, ceo tim cook said he expects revenues of $81; billion this quarter — as much as 10% lower than he was predicting earlier. apple has never had to downgrade forecasts like this since the iphone was launched back in 2007, and the news sent its shares plunging in after hours trade. the reasons? people aren't upgrading to newer phones in the numbers expected. and more worryingly for the global economy, it has underestimated the scale of the slowdown in china, as dave lee in san francisco explains. investors are investors a re not investors are not used to this kind of news. it has been many new —— many years since they struggle to please their investors.

this letter that came outjust after two o'clock local time has really sent a shot away to those investors so sent a shot away to those investors so well rewarded over the years. it is the letter warning several factors meaning they are going to have a very difficult quarter when they next report their earnings, and it means around five million dollars less —— $5 billion less in global revenue. the reasons for that, numerous. one was simply that people are upgrading their iphones less. it iphone is the most profit —— applicable product they have. that has led big knock—on effect. the supply chain issues affecting their other products that were performing well, they could not get them to consumers quickly enough. the most significant thing is china. sales in china have simply fallen off a cliff and they blamed the economic atmosphere globally for that. they

also blamed increased tensions between the us and china over trade as trickling down to consumers in china so people are simply going into apple stores and shopping online less. it underestimated all those factors, which is why it has given investors this bad news today. that warning from apple came too late to hit us markets, but it is having an impact in asia. but we are seeing in after—hours trade that shares are down 7%. rico hizon is following the story in singapore. nice to see you. how are those companies that work with apple, supply components, how are they doing today? not in good condition. many of these apple suppliers are in south korea and taiwan and they are currently hit by this news from apple. you have the likes of the chip maker from taiwan shedding almost 1% while

foxcon fell by 2%. carbon brief —— pegatron falling by 2.5%. they are in negative territory. samsung electronics dropping i.8%. it also has sony optical and aac technologies down. apple public first profit warning since 2002, and it is the first of the smart phone age comes a day after they report they are contracted by the first time ini9 they are contracted by the first time in 19 months in december. the economy has been pinched by the ongoing trade war with the us which is spilling over into other asian economies. in the commodity markets, oil prices falling amid volatile currency and stock markets as they are warned that economic slowdown and 2019just are warned that economic slowdown and 2019 just as crude supply is

rising globally. thank you so much for that update. let's move to washington. president trump has asked congressional leaders to return to the white house on friday for more budget talks after a meeting on wednesday ended without a deal. the clash over spending has led to a partial shutdown of us government services, now entering its 13th day. it could be just the start of many policy battles this year as democrats take majority control of the house of representatives from today. the president is insisting on more than $5 billion to build a wall along the border with mexico, which democrats refuse to support. he has also promised more tax cuts, this time aimed at helping the middle classes. that would also be controversial. previous cuts boosted the stock market, but were criticised for helping big business and the wealthy, as well as damaging the government's finances. mr trump has moved to cut regulations governing wall street, introduced in the wake of the 2008 financial crash. he has also promised deregulation

for more industries including energy, certain to be another battleground with democrats. both sides want drug companies to cut the cost of medicines, but they have rival plans to tackle the issue. and they're also likely to clash over plans to shake up the us postal service. mr trump's task force says it should act "more like a business." here's what the two sides had to say over the latest battle, the government shutdown. the president and vice—president stayed here over the christmas holidays, and there was absolutely no negotiation from the other side. so, they want to keep delaying and have a government shutdown while president trump has said he wants to secure the border. on our last meeting, the president said, "i am going to shut the government down. " they are now feeling the heat. it is not helping the president. it is not helping the republicans to be the owners of this shutdown. let's get analysis.

dr pippa malmgren is a former economic adviser to president george w bush and founder of the consultancy drpm. lovely to see you. this is going to bea tough, lovely to see you. this is going to be a tough, tough time, isn't it? what can we anticipate? will much get done? remember that the president feels he was elected on a mandate to shut the government down in every possible way, to make all the agencies smaller, to make the budget for government smaller... drain the swamp. drain the swamp. drain the swamp. so drain the swamp. so he drain the swamp. so he has drain the swamp. so he has an unlimited threshold for paying in terms of keeping the government closed. he is like, that is what i am here for. so it will be hard for the democrats to really get their way around this. he wants $5 billion by the way not so much to build the wall, but to finish the existing wall, but to finish the existing wall, just to be clear. the public support for this wall is not so

small in the united states. there is quite a big audience that wants it finished. how will that pay out? yesterday they met for discussions, they'd ended with no deal whatsoever. they wa nt to ended with no deal whatsoever. they want to talk again on friday but the democrats do not know if they will go ahead with a meeting on friday. nancy pelosi backing play and she is a force to be reckoned with. it has nothing to do with the budget, it has to do with bringing impeachment process into motion, not that it necessarily goes anywhere because the senate is a republican, nonetheless they can create irritation. they want his tax returns and that will be a constant issue. i think they will try to bring personal pressure on the president and the president will be bringing public government pressure on the democrats. while all this is going on and the wrangling within the capitol hill and we see one get ahead and the

other is a tug of war, what is this mean for the world's biggest economy? well, the longer that government shutdown goes on, the more damage it doesin shutdown goes on, the more damage it does in turn —— terms of government spending. as the rest of the economy is working very well. the rest of the economy isn't necessarily so effected by this. the stock market has fallen but not so dramatically, so the question is how long does it persist? if the us economy has a tough 12 months ahead, which many predict it will, how does it play into the 2020 presidential race? effectively the presidential race has begun, and it serves the president whose audience wants the government shut down unless it does certain things, so he looks strong to his supporters. the democrats look strong to their supporters and meanwhile we have an impasse. i think the bottom line is we can expect this fight to persist for a while.

thank you for your time. it has been great to get your analysis today. we shall watch this space covering every twist and turn. now, let's brief you on some other business stories. uk firms are being squeezed by labour shortages and a slowdown in sales amid the uncertainty over brexit. that's according to a survey by the british chambers of commerce. it says growth in the service sector was the slowest in two years in the last months of 2018. and four out of five employers in manufacturing, and almost as many in the services sector are struggling to find the right workers. that is show you some numbers. japan is closed again today for a public holiday. hong kong trading down by 0.6%. australia not that impacted i apple, so bucking the trend. south korea down, taiwan struggling. because of that story about apple, it will be interesting to see how it

impacts wall street later when it trades. they are one of the biggest stocks in the united states. that is your business briefing. jonathan is back in a moment and we will do our news briefing. but 1st: two men have been arrested on suspicion of arranging the illegal movement of migrants across the english channel into the uk, the national crime agency has said. the 33—year—old iranian and 24—year—old briton are being held in manchester. more than 200 people have reached the uk in small boats since november. ben ando reports. a major incident is how the home secretary has described the increase

in numbers of those crossing the english channel in small boats. we went to dover to see the work being done by the border force and was taken on board one of its patrol boats. in the last 48 hours there have been no more reports of migrant crossings. most of those attempting the journey from france are aiming at the 200 or so miles of kent coastline. patrolling this is a huge job. he has recalled two more border force boat from the mediterranean where they have been assisting, and now want the royal navy to join in. ina now want the royal navy to join in. in a statement, the ministry of defence confirmed it is ready to help out. one source is quoted as saying the offshore patrol vessel hms mersey is available and ready to be deployed in the channel. but is this a crisis orjust a drop in the ocean? in the last two months of 2018, 239 people reached the uk by boat. every 3.5 days, the same number of write using other means

like in lorries. and in other european countries, the totals are far higher anyway. germany is receiving roughly 540 asylum seekers every day. meanwhile in manchester, two people, an iranian and a british man have been arrested by the national crime agency on suspicion of arranging the illegal movement of migrants across the english channel. this is that briefing on bbc news. the latest headlines: all change in washington. democrats prepare to take power in congress as the government shutdown continues. scientists say they've discovered the source of a cholera outbreak in yemen — one of the worst epidemics in history. one giant leap for china's space programme as it successfully lands a probe on the far side of the moon. let's have a look now

at the stories that are making the headlines in the media across the world. we begin with the daily telegraph here in the uk. it has a letter from the former brexit secretary, david davis, calling for theresa may to delay the vote on the deal. his theory? as time runs out, the eu's offer will improve. let's stay in the uk. the guardian now has the home secretary sajid javid under fire for saying it should be made harder for refugees arriving in britain on illegal boats to gain asylum. he'd claimed it could act as a deterrent to others. financial times reports the eu is stepping up security over fears chinese tech companies could be cyber spying. then, the atlantic, as many other, covering our big business story. its article pulls out five ways to look at apple's slump, but says none are good for apple.

and finally, business insider. it's among many reporting on the us giving google the green light on what it calls minority report style technology. dear members and tom cruise movie? —— do you remember. dear members and tom cruise movie? -- do you remember. ama old enough. —— i am. with me isjonathan charles, managing director of communications at the european bank for reconstruction and development. was a lovely over christmas and new year, very little mention of exit because all the mps were way? they tell the wharf words is definitely back. they use the word